WCC advances Eskom talks, export coal project
Coal producer Waterberg Coal Company (WCC) and State energy utility Eskom remain in discussions to resolve the “outstanding require-ments” to convert the Waterberg coal project’s (WCP’s) offtake memorandum of understanding into a coal supply agreement (CSA).
The outstanding requirements included coal specification finalisation, final pricing, delivery dates and providing Eskom with a satisfactory due diligence report on the definitive feasibility study (DFS).
The proposed CSA would see the WCP deliver coal to Eskom for an initial 30-year term.
WCC sought to resolve all outstanding requirements early this year.
The coal development company last week also said that an extension of its convertible secured facility remained on an on-demand basis, with the revised balance on October 17, including accumulated interest, at A$39.3-million.
Further elaborating on its developing export project, the company reiterated that infra- structure engineer Ardbel had been commis-sioned to complete a DFS on the viability of a standalone export project, located in the south of the WCP area.
Stage 1 of the project would likely see the build-up to two-million tons a year of export product, with first coal to be produced during the first quarter of 2016.
Based on the draft DFS, the project team was currently undertaking an optimisation exercise on the mine and production plan to increase production to four-million tons of coal over a six-year period by adding additional plant modules.
“Based on the draft DFS and the optimisation exercise for the export project, the WCP part-ners are in discussions with certain banks and potential coal offtake partners with respect to funding arrangements for the proposed project development,” said WCC.
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